The Wine House discovers $400,000 in 'lost' inventory using SAS®
Midsize wine retailer achieves 100 percent ROI in less than six months
Economic times may be tough, but Bill Knight, owner and president of The Wine House, is toasting a 100 percent return on his investment in SAS Enterprise BI for Midsize Business.
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The first day the SAS application was live, the brick-and-mortar and Internet retailer discovered 1,000 items of wine that hadn’t moved in more than a year.
"That's significant cash tied up in inventory," says Knight. "We had a huge sale to blow it out, generating $400,000 in capital in one weekend, and just in time, because in today's economy, we'd be choking on that inventory."
Midsized solution, rapid implementation
Knight attended a retail technology conference and spoke with several vendors, but SAS was the only one with solutions scaled for midsize businesses. Working with a channel partner, The Wine House had SAS up and running within four weeks.
Aged inventory reduced by 40 percent
With SAS, Knight now has a real-time view into his inventory and is able to drill down by department, supplier, margins, price points, age – all the way down to pinpointing slow-moving bottles on the shelf so that he can promote them and move them out.
"This is a tremendous benefit for a retailer, especially in this economy, to know exactly what's going on in the business in a timely way with as much detail as needed," says Knight.
Using SAS, The Wine House has reduced its aged inventory by 40 percent. "Managing inventory is a crucial balancing act, and SAS allows us to know exactly what's going on so that we can move quickly," says Knight.
Better buying decisions
A story from the Internet Retailer further demonstrates how The Wine House is using SAS to fine-tune buying strategy: During the holidays, the retailer pulled back from a planned $30,000 wine purchase because analytics revealed how much of the supplier's product was already in stock and hadn't moved in a year.
"I told him we couldn't take any more of his inventory until we worked through what we had," says Knight. "We knew we had a problem, but other than walking the floor and recalling, we couldn't identify this kind of information before."2
$60,000 savings in one simple step
"The next thing we're going to do is build a dashboard that shows us current customers, new customers and retention rates so that if our new customer or retention count is going down, we'll know right away and can do something about it," says Knight.
Clean customer data = outstanding customer service
“Supermarkets sell wine and have a lot more marketing resources than I do,” says Knight. “But SAS is allowing me to do more sophisticated marketing so that I can keep up with the big boys.”
"Now, I can get the answers I need and base decisions on facts rather than gut intuition," says Knight. "As a result, I've got less money tied up in inventory, I know who our best customers are, how to market to them and can monitor the effectiveness of our marketing.
"Our ROI with SAS has been well over 100 percent," says Knight. "I made all my money back in less than a year, so my return on investment has been fantastic."
1 Information Management, May 2009.
The results illustrated in this article are specific to the particular situations, business models, data input, and computing environments described herein. Each SAS customer’s experience is unique based on business and technical variables and all statements must be considered non-typical. Actual savings, results, and performance characteristics will vary depending on individual customer configurations and conditions. SAS does not guarantee or represent that every customer will achieve similar results. The only warranties for SAS products and services are those that are set forth in the express warranty statements in the written agreement for such products and services. Nothing herein should be construed as constituting an additional warranty. Customers have shared their successes with SAS as part of an agreed-upon contractual exchange or project success summarization following a successful implementation of SAS software. Brand and product names are trademarks of their respective companies.
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The Wine House
To survive the recession and move the business forward, The Wine House needed to track the productivity of its extensive inventory and access current, accurate customer data to better service and market to its best customers.
SAS Enterprise BI for Midsize Business
Using SAS, The Wine House discovered $400,000 of lost inventory, reduced aged inventory by 40 percent and has real-time access to customer data for better targeted marketing.
“I've got less money tied up in inventory, I know where our customers are coming from, how to market to them and can monitor the effectiveness of our marketing. Our ROI with SAS has been well over 100 percent."”
Owner of The Wine House